Xiaomi shares slip as Samsung and Apple widen smartphone lead

Xiaomi’s stock fell in Hong Kong after a market research report showed the company’s global smartphone market share fell to 11%, placing it third behind Samsung at 22% and Apple at 20%. Shares traded at HK$25.82, below this month’s high of HK$26.70.

The report said Xiaomi’s share slid from about 15% in the second quarter of last year to 11% in the latest quarter. It attributed part of Samsung’s gain to a delayed launch that shifted demand into the quarter and said Apple benefited from a strong iPhone upgrade cycle. The research firm also noted Samsung expanded in the budget segment.

The report described shifts in the sub-$400 segment, where several vendors have reduced volume-driven tactics and adjusted retail prices while emphasising higher-margin models. Rising memory and storage costs were cited as a major factor for manufacturers of low-cost phones, with memory and storage accounting for roughly 60% of the bill of materials for budget devices.

Rujan Bjorvovde, principal analyst at the research firm, warned: “Managing the surging component costs is incredibly complex and unpredictable, with some vendors facing memory costing more than four to five times what they did a year ago.”

Xiaomi’s most recent quarterly results showed declines in its core handset business. First-quarter revenue fell to RMB99.14 billion from RMB111.29 billion a year earlier. Smartphone revenue dropped about 10% to RMB79.3 billion. Profit for the period fell to RMB4.7 billion from RMB10.89 billion.

The company reported growth in its Smart Electric Vehicle, AI and New Initiatives segment, which rose 6.9% to RMB19.9 billion. Xiaomi delivered 80,856 vehicles in the quarter, up from 75,869 in the previous quarter.

Chart indicators show the share price has declined from HK$61.45 in June last year to the current level and is trading below the 50- and 200-day moving averages and the 61.8% Fibonacci retracement level. Some analysts flagged a potential downside test of support near HK$21.35 as investors await Xiaomi’s next earnings report, expected in August.

The report listed market share shifts, higher component costs and changes in mass-market vendor strategy as key industry developments. Xiaomi’s EV and new initiatives segment recorded higher revenue in the quarter, while smartphone revenue fell.